How to apply for MITI approved bumiputra IPO shares?

07/06/2011

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7 June 2011 is the closing date for IPO bumiputra special shares application to Ministry of International Trade and Industry (MITI) as the approved bumiputra investors, in respect of initial public offering for OLDTOWN Berhad and Bumi Armada Berhad. If you missed this deadline, you still can apply the IPO shares under Malaysian public category when the IPO launched later.

.Definition and criteria of Bumiputra investors

All Bumiputra investors who are interested to apply for IPO special shares need to register with the MITI by submitting the registration form at MITI portal. Bumiputra investors include individuals, companies and cooperatives who meet the definition and criteria of bumiputra status set out below:

Bumiputra

Definition and criteria

Individual

For Peninsular Malaysia : Bumiputera as defined under Article 160(2) of the Federal Constitution.

For Sarawak and Sabah, Bumiputera as defined under Article 161(A) Clauses (6a), (6b) and (7) of the Federal Constitution.

Company

Established under the Companies Act, 1965,
Paid-up capital of at least RM25,000,
Shareholders are 100% Bumiputera,
Board of Directors are at least 51% Bumiputera,
Managerial and Professional Staff are at least 51% Bumiputera,
Supporting Staff are at least 51% Bumiputera

Cooperative

Shareholders or cooperative members must be at least 95% Bumiputera.

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Minimum amount of Bumiputra shares investment

There is no minimum amount of investment application for IPO Bumiputra special shares. However, under the Capital Markets & Services Act 2007, if an investor applies for shares of a total value less than RM250,000, then the investor need to prove that:

For individual with a total net personal assets value of at least RM3 million;

For company with a total net assets value of at least RM10 million based on the latest audited accounts.

An investor would have been better off to apply IPO shares valued RM250,000 or more, otherwise the investor would have to prove possession of total assets worth. This requirements appear rigid.

MITI reserves the right in deciding the number of shares to be allocated to each investor. An investor must, to the best of his ability, take up all the shares allocated and make payment within the timeframe set by the merchant banker or the company seeking IPO listing. Failure to accept the shares allocated will affect the listing processes and schedule of a company, as such an investor who fails to take up the allocation or rejects the allocation may be blacklisted by MITI.

Supporting documents & proof of financing for IPO application monies

1.

Application Letter / Letter of Intent

2.

Profile form – individual, company or cooperative

3.

Supporting financing letter from financial institutions

4.

Proof of financial capacity, such as:

i. The latest Bank Statement, for the last three months

ii. Shares Certificate

iii. ASN, ASB, Tabung Haji

iv. Employees Provident Fund Statement

v. Other documents on financial capacity or ownership of assets

5.

For a company or cooperative, additional documents:

i. The Latest Audited Financial Report

ii. Board of Directors’ Resolution for the shares applied

iii. The Latest Form of Annual Return, Form 24 & Form 49 (for company)

From the above, an investor first submits the application MITI for approvals together with the financing proof document to substantiate the investor has the financial ability to subscribe the allocated IPO Bumiputra shares. Upon MITI’s approvals and allocated number of shares, the investor will then need to subscribe and pay for the application monies within the timeframe set by the MITI.

Guidelines & procedures for application of Bumiputra special shares

The MITI issued the guidelines that gives an explanation on the conditions and procedures to be complied with by individuals, companies or cooperatives when applying for Bumiputera Special Shares.

For detailed of the guidelines and registration forms, visit Ministry of International Trade and Industry (MITI) website at www.miti.gov.my.